Gold & Silver Daily

Ed's Critical Reads

Apr 24, 2015

Bankruptcies Suddenly Soar Across Corporate America, Worst Since Q1 - 2009

"Come down to Houston," William Snyder, leader of the Deloitte Corporate Restructuring Group, told Reuters. "You'll see there is just a stream of consultants and bankruptcy attorneys running around this town."

But it's not just in Houston or in the oil patch. It's in retail, healthcare, mining, finance. Bankruptcies are suddenly booming, after years of drought.

In the first quarter, 26 publicly traded corporations filed for bankruptcy, up from 11 at the same time last year, according to data from bankruptcydata.com. Six of these companies listed assets of over $1 billion, the most since Financial-Crisis year 2009. In total, they listed $34 billion in assets, the second highest for a first quarter since before the financial crisis, behind only the record $102 billion in 2009.

The largest bankruptcy was the casino operating company of Caesars Entertainment. Next in line were Doral Financial, security services firm Altegrity, RadioShack, and Allied Nevada Gold. The first oil-and-gas company showed up in sixth place: Quicksilver Resources. It joined privately owned natural-gas drillers in crushing their investors.

This very interesting article was posted on thestreet.com Internet site a week ago today---and I thank Casey Research's BIG GOLD editor Jeff Clark for sending it our way yesterday.

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How 'Spoofing' Might Have Crashed the Market

Earlier this week a trader was arrested in London and accused of "spoofing." What's spoofing and what does it have to do 2010 flash crash? Bloomberg View's Matt Levine explains. (Levine is a Bloomberg View columnist. The opinions expressed are his own.)

Well, dear reader, if you want to know exactly how JPMorgan et al---along with their HFT buddies---rig silver and gold prices lower, all you have to do is watch this 1:19 minute video commentary posted on the Bloomberg website at 5:39 a.m. Denver time yesterday morning---and you'll have your answer.  I thank Dan Lazicki for sending it along---and it's an absolute must watch.  Ted Butler has something to say about this in the quote in The Wrap.

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Initial Claims Worse Than Expected (Again), Remain Flat For 2015

For the second week in a row, initial claims were worse than expected and increased year-to-date, While still below the magic 300k levels, claims printed 295k against expectations of 288k confirming the stagnation of the job market since the end of QE3 and the government's fiscal year. California and New York saw the biggest rise in initial claims with only Illinois seeing a drop; notably Texas saw layoffs across various sectors, as it seems it is not as 'diverse' as Richard Fisher propagandized. After 4 straight weeks of decline, continuing claims rose this week by the most in almost 3 months (but remains close to 15 year lows).

This tiny Zero Hedge story, along with a most excellent chart, appeared on their Internet site at 8:38 a.m. Thursday morning EDT---and it's the second story in a row from Dan Lazicki.

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New Home Sales Tumble by Most in Almost 2 Years as Northeast Crashes

After existing home sales sent stocks vertical on great news, so new home sales plunge has sent stocks vertical on bad news. An 11.1% drop MoM - the biggest since July 2013 - dragged new home sales back below 500k to 481k SAAR - the biggest miss in a year. Sales of new homes collapse 33.3% in The Northeast and The South saw new home sales crash 15.8%.

This is another brief Zero Hedge piece---and this one is courtesy of reader M.A.  It appeared on their website at 10:07 a.m. EDT yesterday---and the three embedded charts are definitely worth your while.

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U.S. Manufacturing PMI Misses by Most on Record as New Orders Tumble

On the heels of weak PMIs from Europe and Asia, Markit's US Manufacturing PMI plunged to 54.2 in April (from 55.7). Against expectations of a rise to 55.6, this is the biggest miss on record. Of course, this is 'post-weather' so talking heads will need to find another excuse as New Orders declined for the first time since Nov 2014.

This Zero Hedge commentary from Thursday morning EDT is built around a Bloomberg story.  It---and the ZH piece---are both worth your time---and it's the second offering in a row from reader M.A.

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Stockman: Global 'Mania' in Government Bonds is Veering Toward Disaster

The world's central banks have managed to brew up a "planet-wide mania" in government bonds that are trading at dangerous negative yields and could lead to a meltdown, according to David Stockman, White House budget chief in the Reagan administration.

Stockman said the level of complacency in world financial markets is "downright astounding — even stupid."

He cited data from BlackRock Investment Institute and Thomson Reuters that there are now $5.3 trillion in government bonds trading at negative yields, mostly in Europe, with already-low U.S. Treasury yield levels being pushed lower by the strength of the dollar.

"The central banks are just mechanically and blindly pushing on a string of monetary expansion that is levitating not the main street economy but only financial asset prices in the canyons of Wall Street," Stockman wrote on his Contra Corner blog.

This article showed up on the newsmax.com Internet site at 6:40 a.m. EDT on Thursday morning---and I thank West Virginia reader Elliot Simon for sharing it with us.

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Marc Faber: 'Global Economy is Weakening'

The global economic picture isn't bright, and central banks are largely to blame, says Marc Faber, publisher of the Gloom, Boom & Doom Report.

"The global economy is not strengthening. It is weakening," he told CNBC. "China is weakening. The U.S. economic statistics recently have been on the weak side."

China's economy grew 7 percent in the first quarter, its worst showing in 6 years, and the Atlanta Federal Reserve's forecasting model shows growth of only 0.1 percent for U.S. GDP last quarter.

The Fed made a mistake in cutting short-term interest rates to almost zero, Faber argued. "The monetary policies as conducted by the Fed have created a lot of unaffordability in the system."

This is another story from the newsmax.com Internet site.  This one was posted there on Monday morning---and it's another story from Elliot Simon.

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Oil slump may deepen as U.S. shale fights OPEC to a standstill

The U.S. shale industry has failed to crack as expected. North Sea oil drillers and high-cost producers off the coast of Africa are in dire straits, but America's "flexi-frackers" remain largely unruffled.

One starts to glimpse the extraordinary possibility that the U.S. oil industry could be the last one standing in a long and bitter price war for global market share, or may at least emerge as an energy superpower with greater political staying-power than OPEC.

It is 10 months since the global crude market buckled, turning into a full-blown rout in November when Saudi Arabia abandoned its role as the oil world's "Federal Reserve" and opted instead to drive out competitors.

If the purpose was to choke the U.S. "tight oil" industry before it becomes an existential threat - and to choke solar power in the process - it risks going badly awry, though perhaps they had no choice. "There was a strong expectation that the U.S. system would crash. It hasn't," said Atul Arya, from IHS.

This longish, but very interesting commentary by Ambrose Evans-Pritchard put in an appearance on the telegraph.co.uk Internet site at 8:59 p.m. BST in London on Wednesday evening---and it's the first contribution of the day from Roy Stephens.  It's worth reading if you have the interest.

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These Two Assets---Coal and Oil---Shows Us That a Crash is Coming

If the foundation of the financial system is debt… and that debt is backstopped by assets that the Big Banks can value well above their true values (remember, the banks want their collateral to maintain or increase in value)… then the “pricing” of the financial system will be elevated significantly above reality.

Put simply, a false “floor” was put under asset prices via fraud and funny money.  Consider the case of coal.

In the U.S., coal has become a political hot button. Consequently it is very easy to forget just how important the commodity is to global energy demand. Coal accounts for 40% of global electrical generation. It might be the single most economically sensitive commodity on the planet.

With that in mind, consider that coal ENDED a multi-decade bull market back in 2012. In fact, not only did the bull market end… but coal has erased virtually ALL of the bull market’s gains (the green line represents the pre-bull market low).

This short, but must read article [courtesy of Phoenix Capital Research] showed up on the Zero Hedge website at 10:12 a.m. EDT on Thursday morning---and the charts alone are worth the trip.  It's the third offering of the day from reader M.A.

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Deutsche Bank to pay record $2.5 billion to resolve LIBOR rigging

Deutsche Bank AG today was ordered to pay a record $2.5 billion fine and fire seven employees to settle U.S. and U.K. investigations into its role in manipulating Libor.

Deutsche Bank must terminate six London employees and one in Frankfurt who engaged in wrongful conduct, the New York Department of Financial Services said in a statement. The DFS didn't identify them by name and said one is a managing director, four are directors, and two are vice presidents.

"Deutsche Bank employees engaged in a widespread effort to manipulate benchmark interest rates for financial gain," DFS Superintendent Benjamin Lawsky said in the statement. "We must remember that markets do not just manipulate themselves: It takes deliberate wrongdoing by individuals."

Of course that last statement is equally true about the precious metal market as well.  This news item appeared on the Bloomberg website at 6:00 a.m. Denver time yesterday morning---and I found it in a GATA release.

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Greece's Piraeus Bank offers relief to poverty-stricken

Piraeus Bank will write off credit cards and retail loans up to €20,000---(US$21,484) for Greeks who qualify for help under a law the leftist government passed to provide relief to poverty-stricken borrowers, it said on Thursday.

Greece has received two E.U./IMF bailouts totalling €240 billion since it was hit by a debt crisis. The austerity programme imposed as a condition of the rescue has left one in four people out of work, and thousands struggling to pay debts.

The Syriza party was elected in January on a promise to end the belt-tightening. Its first legislative act was to pass a bill offering free food and electricity to thousands of struggling Greeks.

Piraeus said it would also write off interest on mortgages for qualifying borrowers, but did not provide details on how many people might benefit.

The above four paragraphs is all there is to this tiny Reuters article from Thursday morning EDT.  It was posted there at 9:56 a.m.---and I thank reader 'David in California' for finding it for us.

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Bulgaria to build new $236mn ‘gas corridor’ with Romania and Greece

Bulgaria has reportedly inked a deal on a new “gas corridor” with Romania and Greece which will be completed in 2018, and is expected to cut the country’s almost total dependency on Russian natural gas.

The agreement on the $236.2 million link between Bulgaria, Romania and Greece, which is also known as a vertical gas corridor, has been signed by the energy ministers of the three countries in Sofia, the Wall Street Journal reported on Wednesday. Bulgaria will also be able to buy about 3-5 billion cubic meters of gas annually from Azerbaijan and from Greece’s liquefied natural gas terminals.

“We are finally getting a new source of gas because until now we were totally reliant on one source—Russia,” Bulgaria’s Deputy Energy Minister Zhecho Stankov was cited as saying by WSJ.

Bulgaria consumes about 3 billion cubic meters of natural gas, 95 percent of which is imported from Russia, and the majority of that comes through Ukraine which is seen as an unreliable transit country. It has been cut off from Russian supplies twice, in 2006 and 2009. Bulgaria has been seeking to diversify its gas supply by building interconnection links with neighbors.

This Russia Today story put in an appearance on their Internet site at 12:12 p.m. Moscow time on their Thursday afternoon, which was 5:12 a.m. EDT in Washington.

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U.S. military instructors in eastern Ukraine combat zone – Russian military

The Russian Defense Ministry said the U.S. military instructors have been spotted in the combat zone in eastern Ukraine, training the country’s National Guard in the field, despite promises to hold the exercises at a remote range in Lvov.

Defense Ministry spokesman Major General Igor Konashenkov slammed Washington’s claims of increased presence of Russian air defense units in the Donetsk and Lugansk Regions of Ukraine as “astonishing in its incompetence,” TASS reported.

On Wednesday, U.S. State Department spokeswoman Marie Harf said that it’s currently “the highest amount of Russian air defense equipment in eastern Ukraine since August,” without providing any evidence to substantiate the claim.

Konashenkov explained that Harf’s statement was just an attempt to “warm up” the general public ahead of the NATO summit, scheduled to take place in Antalya, Turkey on May 13-14.

This Russia Today article was posted on their website at 5:52 p.m. Moscow time on Wednesday afternoon---and it's another offering from Roy Stephens.

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Pepe Escobar -- Brzezinski Bye, Bye: Eurasia as the U.S. Knew it is Over Forever

Move over, Cold War 2.0. The real story, now and for the foreseeable future, in its myriad declinations, and of course, ruling out too many bumps in the road, is a new, integrated Eurasia forging ahead.

China’s immensely ambitious New Silk Road project will keep intersecting with the Russia-led Eurasia Economic Union (EEC). And that will be the day when the EU wakes up and finds a booming trade/commerce axis stretching from St. Petersburg to Shanghai. It’s always pertinent to remember that Vladimir Putin sold a similar, and even more encompassing, vision in Germany a few years ago – stretching from Lisbon to Vladivostok.

It will take time – and troubled times - but Eurasia’s radical face lift is inexorable. This implies an exceptionalist dream – the U.S. as Eurasia hegemon, something that still looked feasible at the turn of the millennium – fast dissolving right before anyone’s eyes.

This commentary by Pepe certainly falls into the absolute must read category, especially for all serious students of the New Great Game.  It appeared on the Asia Times website on Thursday sometime---and this particular iteration is posted on the russia-insider.com Internet site.  The first person through the door with it was South African reader B.V.---and I thank him for this.

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Surreal! Sunset turns massive Chilean Calbuco volcanic eruption into amazing scene

The record-breaking volcanic eruption in southern Chile is dramatically altering skies, as spectacular views emerge of white plumes creeping miles up into the sky after coloring the night orange. A second blast took place hours ago.

Nature’s colossal power was aptly demonstrated by Calcubo, which erupted a second time just a few hours ago, with agencies reporting a stronger eruption than the first.

This extremely interesting news item, courtesy of Russia Today, was posted on their website at 9:02 a.m. Moscow time on their Thursday morning, but was updated at 2:05 a.m. Moscow time on their Friday morning with new photos and videos from the second eruption.  Several readers were kind enough to send me stories on this, but this is the best one---and I thank Roy Stephens for digging it up for us.  The last video clip is amazing.

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Stricter anti-money laundering regulations derail gold trading in Belgium

"The Metals Focus team has just returned from a trip to Belgium. Our meetings and discussions with local players have confirmed that the local gold market has continued to suffer from stricter anti-money laundering measures that have been introduced in recent years.

"It is important to highlight the importance of the Belgian bullion market in Europe. Due to competitive prices being offered by local players, Belgium has for long been an active place of physical gold trading in Europe. This has been particularly the case during 2008-12 when the Belgian gold market witnessed a significant rise in volumes on both sides of the market. On the one hand, a surge in demand for physical gold across Europe in the aftermath of the financial crisis and the sovereign debt problem led to a rise in hand-carried purchases of gold bar and coins by the non-Belgian trade. On the other hand, a sharp rise in jewellery recycling in debt-ridden southern European countries saw an increasing amount of gold being shipped to Belgium for remelting.

"However, the size of the local market has shrunk considerably over the last couple of years, as the regulations on cash transaction payment became tighter .... Since April 2012, traders in Belgium have no longer been allowed to pay or be paid in cash for the trading of precious metals for an amount of €5,000 or more (€3,000 or more from the start of 2014), both in the case of a sale or a purchase of such metals. Prior to that, the upper limit for cash transactions was €15,000.

What the story doesn't say, dear reader, is that these are probably daily cash limits---and it wouldn't deter any serious buyer.  We have a $10,000 per day cash limit in Canada---and it's hardly ever an issue.  The cash rules we have at our store are far stricter than that.  It's $9,500 per person, per week.  I thank Casey Research's own Doug Hornig for passing this story around---and it was posted on the coinworld.com Internet site on Wednesday.

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Sprott said planning unsolicited bid for Canadian metals trusts

Sprott Asset Management LP is planning to make an unsolicited offer to acquire Central GoldTrust and Silver Bullion Trust valued at $800 million, a person with knowledge of the matter said.

An offer at that level would reflect a 3.5 percent discount to the combined market value of the trusts at the close Wednesday of about $829 million. The proposal could come as early as today, said the person, who asked not to be identified because the information is private.

The trusts, which buy and hold substantially all of their assets in respective metals in bullion and certificates, have been under pressure from investor Polar Securities Inc., the Toronto-based hedge fund. Polar has been urging the trusts to change how unit holders can redeem their investment as a means of closing their trading gaps.

I've posted a few things about this already that Stephan Spicer sent our way.  Now here are the current developments in the main stream media.  This Bloomberg news item showed up on their website at 7:25 p.m. MDT on Wednesday evening---and it's a story I found on the gata.org Internet site.  It's worth skimming if it concerns you.

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2014 FULL YEAR RESULTS: Top Primary Silver Miners Lost $1.9 Billion

With the last remaining company finally releasing their year-end results, my top primary silver miners lost a combined $1.9 billion in net income in 2014.  While two-thirds of the group reported significant write-downs (impairments),  two of the largest companies suffered the highest losses.

Even though the group experienced record net losses, seven of the twelve actually enjoyed positive adjusted income.  Let me explain.  Companies report net income and adjusted income.  Net income includes various items such as impairments, losses (or gains) on derivatives, hedges, investments or financial exchange losses (gains), and etc.

While these financial items are apart of their profit and loss statement, I like to focus on their adjusted income which removes these items in order to get a better idea of how successful they are at MINING SILVER.  As I mentioned before, two of the largest silver producers in the group suffered huge net income losses due to large impairments, but their adjusted income wasn’t as bad.

I'm certainly not prepared to vouch for the financial numbers that are reported in this silver-related story, but they should come as no surprise to anyone.  And even though every single primary silver miner knows that JPMorgan and Scotiabank are short the COMEX futures market in silver up the wazoo, they won't do a thing about it.  Why their senior shareholders stand for it is beyond me.  But it is what it is.  This article appeared on the srsroccoreport.com Internet site on Monday---and I thank reader U.D. for sending it our way yesterday.  It's worth reading.

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Swiss gold exports show Asia buying more as investors sell bars

China and India helped buy up investors' biggest gold sales in more than a year.

Gold exports to China from the refining hub of Switzerland almost doubled to 46.4 metric tons in March, the most among monthly data starting in January 2014, according to the Swiss Federal Customs Administration. Shipments to India more than doubled to 72.5 tons as imports from the U.K. climbed sixfold.

That's an indication that gold bars are leaving U.K. vaults for Switzerland, where they're refined and sent to Asia. India and China, the biggest buyers, boosted purchases in 2013 when investors dumped the metal amid the biggest price rout in three decades. Global sales from gold-backed funds totaled 55.7 tons in March, the most since 2013, data compiled by Bloomberg show.

"The big investor outflows from the U.K. via Switzerland to China and India are a continuation of the flow of metal from West to East," Matthew Turner, an analyst at Macquarie Group Ltd., said by phone from London. "Short-term, it is a sign of weakness, not of strength in the market."

I posted two of Nick's charts on Swiss gold imports and exports just before the Critical Reads section, so you wish to refresh your memory, you can check them out again.  This short Bloomberg story was posted on their Internet site at 3:55 a.m. Denver time on Thursday morning---and I found it embedded in another GATA release.  It's worth reading.

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South African gold miners union plans to demand wage hikes of 75%

South Africa's National Union of Mineworkers is planning to submit demands to the gold sector next week calling for a 75-percent hike in the basic pay for entry-level workers, according to union sources familiar with the matter.

"For the basic wage at the entry level, we are planning to demand a raise to 10,000 rand ($823) a month in the first year from 5,700 rand at present," said a union source, who asked not to be named. This was confirmed by a second source in the union.

That would set the stage for tough negotiations and a potentially protracted dispute with companies in South Africa's gold sector, where profit margins are under pressure.

This gold-related news item put in an appearance on the Reuters website at 1:47 p.m. EDT yesterday afternoon---and it's another story that I found on the gata.org Internet site.

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Alasdair Macleod: Gold, the SDR, and BRICS

If gold doesn't break into the Special Drawing Rights of the International Monetary Fund along with China's currency, the monetary metal might be incorporated into a similar international currency created by the New Development Bank, an institution being established by developing countries, GoldMoney research director Alasdair Macleod writes.

Macleod's analysis is headlined "Gold, the SDR, and BRICs"---and it appeared on the goldmoney.com Internet site yesterday.  It's worth reading as well.  Once again it's a gold-related story I found in a GATA release yesterday.

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Lawrence Williams: Does any nation hold the gold it says it does?

Official central bank gold reserve figures as reported to the International Monetary Fund are at best unreliable---and at worst active deceptions concealing market interventions, Mineweb's Lawrence Williams acknowledged yesterday.

"China has 1,054.1 tonnes of gold in its official reserves. Yeah right! The USA has 8,133.5 tonnes in its reserves – the world’s largest. But forgive me if I treat this figure, and those reported by some other central banks, with about as much scepticism as I treat the official Chinese figure. Much is made of the fact that China has not updated its official reserve figure since 2009 – but then the US has not updated its figure for nearly 40 years. Something similar applies to many other central banks which report identical gold volumes year in, year out."

"It’s all a question of accounting and presentation of statistics. In truth the major central bank holders of gold only tell the IMF what they want the world to believe are their actual attributable gold holdings and the true amounts of accessible physical gold currently held on their own behalf are quite probably somewhat different in a number of cases."

This must read commentary by Lawrie showed up on the mineweb.com Internet site late Thursday morning London time---and it's another story I found in a GATA release, as I was sound asleep when it was first posted.

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Apr 23, 2015

McDonalds Reports Disturbing Numbers, Misses Across The Board; Stock Jumps

Moments ago McDonalds reported its latest sales numbers which were basically atrocious, worse than usual, and missed across the board. From BBG:

  • MCD MARCH TOTAL COMP SALES DOWN 3.3%, EST. DOWN 2.1%
  • MCD MARCH US COMP SALES DOWN 3.9%, EST. DOWN 3.0%
  • MCD MARCH EUROPE COMP SALES DOWN 2.9%, EST. DOWN 1.6%
  • MCD MARCH APMEA COMP SALES DOWN 7.3%, EST. DOWN 4.5%
  • APRIL GLOBAL COMPARABLE SALES ARE EXPECTED TO BE NEGATIVE

At this point the operational challenges facing the company are clearly unfixable in its current iteration which is broken beyond merely a CEO switch, and not even a "buy 1 Big Mac, get 3 Big Macs (and Joseph A Banc suits) free" strategy will fix the ailing fast food maker, whose secular collapse is best captured by the charts below.

This Zero Hedge article appeared on their Internet site at 8:42 a.m. EDT on Wednesday morning---and I thank reader M.A. for today's first story.

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Flash crash arrest lays bare regulatory lapses at all levels -- starting with CME Group

CME Group Inc. concluded within four days of the 2010 flash crash that algorithmic trading on futures exchanges didn't exacerbate losses in the market.

When Washington regulators did a five-month autopsy in 2010 of the plunge that briefly erased almost $1 trillion from U.S. stock prices, they didn't even consider whether it was caused by individuals manipulating the market with fake orders.

Their analysis was upended Tuesday with the arrest of Navinder Singh Sarao -- a U.K.-based trader accused by U.S. authorities of abusive algorithmic trading dating back to 2009. Even that action was spurred not by regulators' own analysis but by that of a whistle-blower who studied the crash, according to Shayne Stevenson, a Seattle lawyer representing the person who reported the conduct.

Regulators were aware of Sarao's trading behavior as early as 2009, when officials at CME -- which runs the exchange where Sarao allegedly placed his problematic trades -- spotted him placing and then canceling large numbers of orders, and warned him against placing deceitful trades, according to an FBI affidavit. Sarao continued to manipulate markets through March 2014, the FBI said.

"How this continued for six years when the CME appeared to know about, it kind of boggles my mind," Dave Lauer, president of Kor Group, a lobbying and research firm, said by phone. "This is about as simple and easy as you can get, and it took them this long to do anything about it."

This is the same CME Group that's aiding and abetting JPMorgan et al in their precious metal price management scheme, particularly in silver.  This must read Bloomberg story showed up on their website at 1:24 p.m. EDT yesterday afternoon---and I found it in a GATA release.

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JPMorgan Chase Bans Storage of Cash in its Safety Deposit Boxes

Some JPMorgan Chase customers are receiving letters informing them that the bank will no longer allow cash to be stored in safety deposit boxes.

The content of a post over on the Collectors Universe message board suggests that we may be about to see a resurgence of the old fashioned method of stuffing bank notes under the mattress.

My mother has a SDB at a Chase branch with one of my siblings as co-signers. Last week they got a letter outlining a number of changes to the lease agreement, including this:

“Contents of the box: You agree not to store any cash or coins other than those found to have a collectible value.”

Another change is that signatures will no longer be accepted to access the box. The next time they go in they have to bring two forms of ID and they will be issued a four-digit pin number that will be used to access the box then and in the future.

The letter, entitled “Updated Safe Deposit Box Lease Agreement,” was sent out to customers at the beginning of the month.

Well, dear reader, the reason that I'm posting this story is because TD/Canada Trust here in Edmonton just advised me of the same thing, so take this as sign of things to come.  This news item appeared on the infowars.com Internet site on Wednesday sometime---and I thank Brad Robertson for sharing it with us.

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Patriot Act extension bill introduced by Senator McConnell

Senate Majority Leader Mitch McConnell,  introduced a bill Tuesday to extend the controversial Patriot Act and its surveillance provisions until 2020.

The extension would allow the National Security Agency to continue to collect data of millions on U.S. phone records daily. The NSA does so under the authority of Section 215, which allows for secret court orders to collect "tangible things" that could be used by the government in investigations.

The Patriot Act was enacted after the September 11 attacks to combat terrorism. McConnell used a Senate rule that will take the bill's extension straight to the floor for voting, a move that would bypass traditional committee vetting process.

Section 215 expires on June 1. The NSA's mass collection program was revealed by former contractor Edward Snowden, sparking a debate about privacy, security and the reach of government surveillance.

This UPI news item was posted on their Internet site at 9:34 a.m. EDT yesterday morning---and it's courtesy of Roy Stephens.

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Securing Your Assets When Financial Privacy Is Dead

Daily Bell: Hi, Nick. It’s a pleasure to have another opportunity to speak with you. Last time we interviewed you, you dug into the U.S. government’s new FATCA rules and how they will impact Americans who invest outside the country. At InternationalMan.com, you often deal with the broad topic of privacy. Do you truly believe that Western governments have embarked on a coordinated attack on the private lives of their citizens?

Nick Giambruno: Not only have they embarked, but they have succeeded in killing off financial privacy. But before we go into details of why I say that, it’s important to identify the countries that are and are not responsible for this push, as it gives a clue to the motive. You never hear of financially sound countries, like Switzerland, Singapore, or Hong Kong advocating privacy-killing measures like FATCA. You never hear their governments denouncing the supposed “danger” of tax havens. It’s only the bankrupt states drowning in debt—like the U.S., France, and the U.K.—that have become hostile to privacy. The hostiles have won. Practically speaking, financial privacy is dead.

Given what has happened, it’s only prudent to assume that sooner or later all the details of your financial life will come to rest in a government computer—if they’re not sitting there already. You should plan accordingly. We live in a world where pretty much every penny you earn, save, and spend leaves a permanent record somewhere, and that can be retrieved for scrutiny by government employees at any time.

This interview appeared on the internationalman.com Internet site yesterday---and I thank senior editor Nick Giambruno for passing it around.

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Deutsche Bank sets aside €1.5 billion as Libor settlement looms

Deutsche Bank will take a litigation charge of "approximately €1.5 billion," it said on Wednesday as the German lender nears settlement of claims that it tried to manipulate interbank lending rates.

A resolution of the long-running saga could come as early as Thursday, and the banks total fine is likely to be more than €2 billion, according to people familiar with the situation.

That total would represent the largest penalty meted out so far in connection with the scandal over the manipulation of the London interbank offered rate (Libor) and other interbank borrowing rates.

The above three paragraphs from this Financial Times story from Wednesday are all that were posted in the clear in this GATA release from yesterday---and I thank Chris Powell for posting it.

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The Swiss Franc Is Plunging After Swiss National Bank Comments

As Bloomberg reports, Swiss National Bank says its reduced the group of sight deposit account holders that are exempt from negative rates.

Says negative rates to apply to sight deposit accounts held at SNB by enterprises associated with federal govt, including pension fund PUBLICA.

Accounts will have minimum exemption threshold of CHF10m, to which negative interest does not apply.

Accounts of cantons of Geneva and Zurich, City of Zurich to be wound up---and account of SNB pension fund will also be subject to negative rates.

This Zero Hedge article is definitely worth your while.  It appeared on their website at 8:33 a.m. EDT on Wednesday morning---and it's another offering from reader M.A.  There was also a Reuters story on this posted at the gata.org Internet site yesterday---and it's headlined "Swiss central bank reduces exemptions from negative interest rates".

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Ukraine, in snub to Moscow, to adopt British war-time symbol, ditch Soviet war name

Ukraine, in a break with tradition that is certain to rile Moscow, is ditching the Soviet name for World War Two and aims to adopt the poppy, a mainly British wartime symbol, to mark the 70th anniversary of the victory over Nazi Germany.

The moves, signaled by Prime Minister Arseny Yatseniuk on Wednesday, marked an attempt by Kiev to distance itself from Moscow's Soviet-style celebrations, planned for May 9, as the conflict with Russian-backed separatists in eastern Ukraine drags on.

In another break with the Soviet past, Kiev will align its calendar with that of its European allies by adding for the first time May 8 - known in the West as Victory in Europe Day - as a national holiday.

A decree signed by President Petro Poroshenko fixed May 8 as a day for reconciliation between those Ukrainians who fought only the Nazis with those who, after the war, went on to fight Soviet rule also.

My goodness sakes alive, dear reader, how petty/childish can one get?  Of course sociopaths are like that---and I know quite a few.  So do you if you know the checklist for them.  This Reuters article, filed from Kiev, put in an appearance on the news.yahoo.com Internet site around 7 a.m. EDT yesterday morning---and I thank Jim Skinner for passing it around.

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U.S. uses Ukraine crisis to derail Russia-Germany partnership – Lavrov

Washington’s strategy is to sow discord throughout the world to keep itself in the loop in every region, Russian Foreign Minister Sergey Lavrov told Russian media. The Ukrainian crisis was initiated to prevent an alliance between Russia and Germany.

“Strategically [the U.S.] don’t want to allow a situation in which important regions of the world live and prosper without them, without the Americans. That is why it is important for them to keep people dependent of them,” he said.

The assessment was voiced by Lavrov during a two-hour marathon Q&A session with three Russian radio stations: Echo of Moscow, Moscow Speaks and Sputnik Radio. They were represented by their respective chiefs, Aleksey Venedictov, Sergey Dorenko and Margarita Simonyan, who also heads Russia Today.

The Ukrainian crisis is used by the U.S. to derail Russia’s partnership with the E.U. and particularly Germany, Lavrov stressed.

This right-on-the-money Russia Today news item, which is definitely worth reading, showed up on their Internet site at 3:05 p.m. Moscow time on their Wednesday afternoon, which was 8:05 a.m. EDT in Washington.  It is, of course, courtesy of Roy Stephens.

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Washington prepares for diplomatic war of attrition with Russia

The U.S. reportedly expects that the ongoing confrontation with Russia would continue until at least 2024 and involve many directions. Washington wants to rally support of its European allies to continue mounting pressure on Moscow.

The expected diplomatic and economic war of attrition is being outlined in a Russia policy review currently prepared by Celeste Wallander, special assistant to President Barack Obama and senior director for Russia and Eurasia on the National Security Council, reports Italian newspaper La Stampa. The publication said it learned details of the upcoming policy change from a preview that Washington sent to the Italian government to coordinate the future effort.

U.S. diplomats say Russia changed the cooperative stance it assumed after the collapse of the Soviet Union and is now using force to defend its national interests, the paper said. The change is attributed to the personality of Russian President Vladimir Putin, who, Washington expects, will remain in power until at least 2024.

This is the second story in a row from the Russia Today Internet site.  This one appeared there at 7:26 a.m. Moscow time on their Wednesday morning, which was 26 minutes after midnight in Washington.  It's also courtesy of Roy Stephens.

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E.U. Effort to Punish Gazprom by Retroactive Antitrust Case Absurd – Expert

Ben Aris, editor in chief of Business New Europe magazine, says that the European Union's decision to serve Gazprom with a retroactive an anti-monopoly case is a foolish thing to do, adding that it seems to be a politically motivated decision.

Speaking to Radio Sputnik on Wednesday, Aris explained that while Gazprom's network of fixed pipelines makes it a natural monopoly, and that "from a business point of view, if you introduce new regulations, you can't turn around and implement them retroactively on contracts that were signed in compliance with existing regulations."

Aris noted that even if Gazprom "may have been charging economic rent for some of the gas deliveries…those deals were cut under existing regulations and European countries signed them, agreeing to the prices."

The expert explained that while "it's normal for governments to want to regulate natural monopolies…this should be done at the level of an intergovernmental agreement, rather than introducing legislation and then applying it retroactively."

This very interesting article put in an appearance on the sputniknews.com Internet site at 8:05 p.m. Moscow time yesterday evening---and it's also courtesy of Roy Stephens.

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Putin, Hollande to discuss Ukraine, Middle East, Mistrals in Yerevan

Russian presidential aide Yuri Ushakov has confirmed that Russian President Vladimir Putin and French President Francois Hollande will meet during a visit to Armenia’s capital Yerevan on April 24. Ukraine will be one of the main themes in focus.

Also, presidents may discuss the situation in the Middle East and the delivery of Mistral amphibious assault ships to Russia.

"I proceed from the assumption that the theme of Mistrals may be raised during the talks in Yerevan. There are quite a few other issues for discussion, Ukraine in the first place," Ushakov said.

"It is very important for all parties to step up the implementation of the Minsk Accords," he said.

This news story, filed from Moscow yesterday, showed up on the tass.ru Internet site at 4:15 p.m. local time---and once again I thank Roy Stephens for finding it for us.  It's worth reading.

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Russia Says No to One-World Government

Victor Olevich: Almost a quarter century has passed since the end of the Cold War. Yet, both Russia and the West once again find themselves at the precipice of a new Cold War. Why did Washington choose to pursue an aggressive foreign policy towards Moscow after the Soviet Union dissolved in 1991? Could these developments have been prevented?

William Lind: The Washington establishment, which is bipartisan, thought that now we could rule the world. It could dictate to everyone and it could force its ideology, which is sometimes called globalism or liberal democracy, but is in fact the soft totalitarianism of Brave New World, on everyone in the world. If necessary, with military force. This is the classic hubris that has destroyed one great power after another. There is nothing new about it.  

Victor Olevich:  Why has Washington chosen Ukraine as a battleground in its new Cold War against Russia?

William Lind: Russia under President Putin represents the state system and the way states normally act within the state system, based on their interests. The ideology of the Washington establishment says that is not how the world is going to work anymore.  It is instead going to be essentially a one world government based in Washington. This ideology includes such concepts as the feminist definition of women’s rights, devaluation of all religions, so called gay rights, and the belief that this must be universal.  Russia is saying no to this.  It is saying that it still believes in the state system and is going to pursue its own interests on the world stage.  So when Russia asserted its interests in the face of Ukraine threatening to join NATO, then Washington reacted very strongly.

This is the most important non-gold related commentary in today's column---and if you want to understand the world's power structure as it exists today, then it's definitely a must read.  It appeared on the russia-insider.com Internet site early Wednesday afternoon Moscow time---and it's also courtesy of Roy Stephens.

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Morgan Stanley remains bearish on Gold for next 2 years

Greece’s uncertain future in the eurozone, global quantitative easing, loose monetary policies and continued demand out of Asia will all provide much needed support for the gold market, but these factors might not be enough to create another bull market, said Morgan Stanley in a snippet.

Analysts at Morgan Stanley expect prices to fall over the next two years as investors leave the marketplace.

“Our Global Cross Asset team highlight in their report that negative rates will continue to drive flow into USD credit, supporting both the house view of ongoing USD strength and our unchanged generally subdued gold price outlook,” analysts added.

This is the sort of drivel that passes for main stream thinking in the gold market---and I would be prepared to bet some serious coin that they are one of the Big 8 traders in the COMEX futures market that's short precious metals.  It was posted on the metal.com Internet site at 9:10 a.m. BST on Tuesday---and I found it on the Sharps Pixley website in the wee hours of yesterday morning.  I had it in lots of time for yesterday's column, but thought I'd save it for today.  Don't believe a word of it.

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Chilean regulator seeks new sanctions against Barrick's Pascua-Lama

Chile's environmental regulator SMA said on Wednesday it will seek new sanctions against Barrick Gold Corp's massive Pascua-Lama gold and silver project, complicating the possibility that the suspended mine might resume construction.

The regulator already fined Barrick $16 million in May 2013 for not complying with some of the country's environmental requirements at Pascua-Lama, which was put on hold indefinitely in October 2013.

Inspections that took place between 2013 and 2015, some of which were scheduled and others triggered by complaints from the local community, had revealed 10 new infractions, the SMA said.

This short Reuters article put in an appearance on their website at 5:39 p.m. EDT yesterday---and it's another gold-related story I found on the gata.org Internet site.

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No Such Thing As a Sure Thing—But Sometimes It’s Close: Louis James

In the investment world, there’s no such thing as a sure thing, and if anyone tells you they have such an investment, you should run the other way. Fast. But sometimes, the odds are so clearly stacked in one direction that it comes pretty close.

How can one be so sure? Due diligence, of course; the devil is in the details—and so is the profit.

It’s impossible to illustrate this without tooting my own horn a bit, so please bear with me on that. The point of the story is critical to investments in all sectors and should help you with your own.

My sector—my specialty—is mining. I’ve been kicking rocks around the world for more than a decade now, learning geology and engineering and metallurgy from world-class experts in their fields. But the point is to make money, not just to figure out nature’s geological puzzles, so I’ve also immersed myself in the world of legendary investors, learning all I can from their successes and failures.

The result is that I now have an encyclopedia of mineral exploration and exploitation projects in my head, as well as experience with thousands of companies in the field—and the outcomes of their efforts. This enables me to very quickly sort the wheat from the chaff.

This commentary by Casey Research's own Louis James appeared on the CR website yesterday sometime---and it's worth reading.

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China’s Stealth Gold Reserves to Quadruple as IMF Seek Answers

Enter the Dragon.

China’s push to challenge U.S. dominance as the global economic superpower and to challenge the dollar as a global reserve currency involves gold – “a lot of gold.”

China may soon make public that it has quietly accumulated a massive hoard of gold in recent years. This was done in order to bolster their bid to have the yuan included in the basket of currencies that make up the IMF’s Special Drawing Rights (SDRs) according to an article by Bloomberg.

This is something Jim Rickards, ourselves and many analysts in the gold sector have said would happen for some time. The People’s Bank of China’s (PBOC) quiet ongoing accumulation of gold is something we frequently cover as we believe it is an important demand factor in the market that is largely ignored by most analysts and in most coverage of the gold market.

Everything in this commentary by Mark has already been posted in my column over the last couple of days, so there's nothing really new here.  But Mark looks at the stories through different eyes---and for that reason, his commentary on them is worth you while.  It was posted on the goldcore.com Internet site yesterday.

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Downwards price manipulation of gold to Asian buyers’ big advantage -- Julian Phillips

It is felt by many that the gold markets are manipulated. The direction of this manipulation is downwards, or just to hold the gold price at current levels.  Certainly it appears that the banking system in the developed world is getting a big advantage in this. On the other side we have a most extraordinary picture. Chinese and Indian demand alone has in the last two years exceeded newly mined gold supplies. That’s around 3,300 tonnes. And Asia is getting it all, at prices down 37.5% from its peak level. Doesn’t this strike you as odd?

Demand such there has never been seen before emanating out of Asia, is not driving up prices? Instead they are getting all this gold at a deep discount? Who’s really getting the big advantage? Why should Asia want to see higher prices? When you can get the entire available stock that comes to the market at these prices, why chase prices?

As it is, more and more mines in South Africa and elsewhere in the world are being taken over by the Chinese. The production of these mines goes straight to China and not through the London and New York markets. It means the physical volumes of gold going through London and New York are shrinking but still enough to allow these markets to keep prices low.

This brief commentary by Julian appeared on Lawrie Williams' website yesterday---and it's certainly worth reading.

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BIS president in 1981: We've got to start rigging the gold market

"Regulating the gold price in the free market" was recommended to central banks by the president of the Bank for International Settlements," Jelle Zijlstra, in a speech at International Monetary Fund headquarters in Washington in September 1981.

The speech, located this week by gold researcher and GATA consultant Ronan Manly, was given as a lecture memorializing the former managing director of the IMF, Per Jacobsson.

Those who follow GATA may recall that Zijlstra, who was president of the Netherlands Central Bank simultaneously with his holding office at the BIS, wrote in his memoirs in 1992 that the price of gold long had been held down by central banks at the behest of the United States, which sought to minimize competition for the dollar as the international reserve currency:

In his speech at the IMF in 1981, Ziljstra said: "I feel that it is necessary for us, within the Group of Ten and Switzerland, to consider ways to regulate the price of gold, admittedly within fairly broad limits, so as to create conditions permitting gold sales and purchases between central banks as an instrument for a more rational management and deployment of their reserves."

Ziljstra added: "On the occasion of the annual meeting of the IMF in Belgrade in 1979 this was brought up, but regrettably, insufficient agreement could be reached to make even a modest start with regulating the gold price in the free market. It is my conviction that relatively small-scale interventions, though not forestalling the subsequent explosion in the gold price, would at least have reduced it to more manageable proportions. Now that the turbulent emotions seem to have quieted down, we would be wise to reflect anew and without prejudice on these subjects."

This absolute must read GATA release appeared on their website yesterday.

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Apr 22, 2015

Fed still wants easy money and any rate increases will be trivial

Janet Yellen wants you to know that while the era of zero rates may be drawing to a close, money will stay cheap for a long time to come.

The Federal Reserve chair and her colleagues have stressed in recent speeches that monetary policy will remain unusually easy after they begin to tighten this year for the first time in almost a decade. They are telling investors that the pace of increases is more important than the liftoff date.

"This should be the slowest tightening cycle since the funds rate became the policy instrument of choice" in 1982, said Roberto Perli, a former Fed official who is now a partner at Cornerstone Macro LLC in Washington.

Policy makers have ruled out an increase at the next meeting of the Federal Open Market Committee, April 28-29. New York Fed President William C. Dudley stressed on Monday that once they start to lift rates above zero, "we will simply be moving from an extremely accommodative monetary policy to one that is only slightly less so."

This Bloomberg news item appeared on their Internet site at 10:00 p.m. Denver time on Monday evening---and I found it embedded in a GATA release.

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Fed's Bill Dudley is alert to global liquidity storm, yet signals 3.5pc rates

The U.S. Federal Reserve will do its best to avert a bloodbath for emerging markets as it prepares to raise interest rates for the first time in eight years, but warned that it cannot let inflationary pressures take hold in the U.S. itself.

Bill Dudley, head of the powerful New York Fed, acknowledged that the institution has a special duty of care for the whole world, vowing to act with caution to soften a potentially brutal squeeze for borrowers holding record levels of dollar debt outside the U.S.

"The normalisation of U.S. monetary policy could create significant challenges for those emerging market economies that have been the recipients of large capital inflows in recent years," he said.

"We at the Fed take the potential international implications of our policies seriously. In part, this is out of simple self-interest, since the international effects of Fed policies can spill back onto the U.S. economy and financial markets. In part, too, it reflects a sense of special responsibility we have given the dollar’s role as the international reserve currency."

This commentary by Ambrose Evans-Pritchard appeared on the telegraph.co.uk Internet site at 7:37 p.m. BST on Monday evening, which was 2:37 p.m. EDT in Washington---and it's the first contribution of the day from Roy Stephens.

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Chatty Former Chairs Turn Up Fed Policy Noise

Paul Volcker is the latest former Federal Reserve chairman to chime in on central bank policy.

Mr. Volcker on Monday lamented the Fed’s large balance sheet, which grew rapidly after the 2008 financial crisis when Ben Bernanke was chairman and Janet Yellen was vice chairwoman. The Fed’s portfolio of assets grew to around $4.5 trillion from less than $1 trillion in recent years through three rounds of bond-buying aimed at spurring stronger economic growth.

“The Federal Reserve should not be so dominant in the markets,” Mr. Volcker told The Wall Street Journal after a press conference detailing his recommendations for financial regulatory reform.

His comments come less than a week after Mr. Bernanke suggested in his blog that the Fed should consider maintaining a large balance sheet. “I wonder if the case for keeping the balance sheet somewhat larger than before the crisis has been adequately explored,” he said.

This worthwhile commentary put in an appearance on the blogs.wsj.com Internet site on Monday afternoon EDT---and I found it yesterday's edition of the King Report.

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Harley Davidson's new warning resonates with a lot of America's biggest companies

When iconic motorcycle maker Harley-Davidson Inc warned on Tuesday that discounting from foreign rivals would dent its profits, the message resonated beyond the motorcycle business.

From cars to construction equipment, the impact of the strong dollar is a big problem for U.S. companies selling overseas. But the U.S. dollar's recent surge to multi-year highs against major currencies, such as the euro and yen, has also become a challenge to their efforts to protect market share on home turf.

Harley's U.S. market share slipped nearly five percentage points in the first quarter to 51.3 percent as competitors offered discounts of up to $3,000 per bike and slashed suggested retail prices by up to 25 percent.

Honda Motor Co Ltd and Suzuki Motor Corp both currently offer $1,000 cash back on selected models.

This Reuters new item, filed from Chicago, appeared on the businessinsider.com Internet site at 6:57 p.m. CDT yesterday evening---and I thank Roy Stephens for sliding it into my in-box just before 2 a.m. EDT this morning.

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Is Berkshire Hathaway ‘too big to fail?’

U.K. regulators want Warren Buffet’s Berkshire Hathaway classified as ‘too big to fail.’ FOX Business Contributor Bob Rice breaks down what this means for the reinsurance business and your bottom line.

This 3:32 minute CNBC video interview is well worth your time---and it's the second offering of the day from Dan Lazicki.

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Oil Drops After API Inventories Show Builds Accelerating Again

After last week's smaller than expected API and DOE inventories data (which was merely average when considering the massive build from the prior week), it appears the machines have realized that everything is not awesome again in the crude complex. For the 15th week in a row, inventories rose - this time by more than expected at 5.5mm bbl (against a 2.5mm bbl expectation). Crude prices are slipping lower.

This tiny Zero Hedge article appeared on their website at 4:38 p.m. EDT yesterday---and the three embedded charts are worth the trip.  I thank Dan Lazicki for this story as well.

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CFTC Charges U.K. Resident Navinder Singh Sarao and His Company Nav Sarao Futures Limited PLC with Price Manipulation and Spoofing

Washington, D.C. – The U.S. Commodity Futures Trading Commission (CFTC) today announced the unsealing of a civil enforcement action in the U.S. District Court for the Northern District of Illinois against Nav Sarao Futures Limited PLC (Sarao Futures) and Navinder Singh Sarao (Sarao) (collectively, Defendants).  The CFTC Complaint charges the Defendants with unlawfully manipulating, attempting to manipulate, and spoofing — all with regard to the E-mini S&P 500 near month futures contract (E-mini S&P). The Complaint had been filed under seal on April 17, 2015 and kept sealed until today’s arrest of Sarao by British authorities acting at the request of the U.S. Department of Justice (DOJ).  After the arrest, the DOJ unsealed its own criminal Complaint charging Sarao with substantively the same misconduct. 

The Standard & Poor’s 500 Index is an index of 500 stocks designed to be a leading indicator of U.S. equities.  The E-mini S&P 500 is a stock market index futures contract based on the Standard & Poor’s 500 Index and is one of the most popular and liquid equity index futures contracts in the world.  The contract is traded only at the Chicago Mercantile Exchange (CME). 

This press release was posted on the CFTC's website yesterday---and it's worth reading.  There was a brief 1:07 minute video clip about this on CNBC yesterday afternoon---and the headline there reads "U.K. trader charged for manipulation contributing to 2010 flash crash".  I thank Karen Nelson for bringing this story to our attention.  That paragon of virtue Bart Chilton had something to say about this as well in a 1:49 minute CNBC video clip headlined "Bart Chilton: Don't think charged trader 'sole culprit'"---and that was courtesy of Dan Lazicki.

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This tiny European state may trigger a Grexit

Finland's rigid stance over euro zone bailouts could become even more hardline after the weekend's election, in what would be a further blow to beleaguered Greece as it tries to avert a default.

A parliamentary election on Sunday in the small, northern euro zone state was won by the opposition Centre Party's Juha Sipila.

He may have to rely on the euro-sceptic Finns Party for support to form a coalition government – a development that analysts say raises risks to the future of the euro area. The Finns Party is against sovereign bailouts and wants to boot Greece from the 19-member euro zone.

"Finland was in the anti-bailout camp before yesterday's election and it's now likely to take an even harder line towards Greece," Nicholas Spiro, managing director at Spiro Sovereign Strategy, told CNBC.

I had a story about his in yesterday's column, but it didn't reflect the outcome of the Finnish elections on Sunday.  This CNBC story from 6:03 p.m. EDT on Monday evening does that---and it's something that Roy Stephens sent our way on Tuesday morning.  He also dug up a Russia Today commentary from yesterday on this issue headlined "Finland: Exhibiting strain of northern independence".

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Lenders Awash With Euros Pay Banks and Governments to Take Loans

Euros are so abundant thanks to Mario Draghi’s easy monetary policy that banks are starting to pay each other to get the cash off their balance sheets.

For the first time, an index of three-month interbank loans in euros fell below zero on Tuesday. Elsewhere, the Spanish government raised funding for the same period of time and got paid to take the money.

They’re the latest signs that the efforts by the European Central Bank President to get cash flowing into the economy are starting to percolate through markets. The plan is for the cheap money created by ECB bond purchases -- known as quantitative easing -- finally to boost growth and stave off deflation.

“It’s good news for borrowers, not so good news for lenders,” said Ciaran O’Hagan, the Paris-based head of European rates strategy at Societe Generale SA. “Mr. Draghi wants us to spend the cash. The purpose of QE is to get us to take on some risk.”

This Bloomberg article put in an appearance on their Internet site at 3:12 a.m. Denver time yesterday morning---and I thank West Virginia reader Elliot Simon for bringing it to our attention.

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Greek bank shares slide to record low as ECB considers pulling the plug

Shares in Greece's stricken banks fell to an all-time low on Tuesday amid fears the European Central Bank was planning to finally pull the plug on the country's lenders.

Banks stocks fell by 4pc on the news that ECB staff had drawn up a memo which proposed limiting the emergency assistance (ELA) that has been keeping lenders alive since the Syriza-led government entered office at the end of January.

Tuesday's trading helped cap off a torrid run which has seen more than 50pc wiped off the value of Greece's lenders since the start of the year.

This news item showed up on The Telegraph's website at 6:00 p.m. BST yesterday evening---and It's another offering from Roy Stephens.

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Hungary, Greece, Cyprus to Restart Food Trade With Russia Despite Sanctions

Hungary, Greece and Cyprus may soon be allowed to export fruit and vegetables to the Russian market, according to a report in the newspaper Rossiyskaya Gazeta.

Russian health authorities are conducting audits of suppliers in all three countries, as well as India, Alexey Alexeyenko, the director of Rosselkhoznadzor (the Russian Federal Service for Veterinary and Phytosanitary Surveillance) is quoted as saying.

"About 20 companies will be verified in Greece and Hungary. In India — less, around four to five. Cyprus has requested a delay for technical reasons and therefore, the audits will begin on April 27, where seven to eight companies will be checked."

Greek Prime Minister Alexis Tsipras met Russian President Vladimir Putin in Moscow in early April and it is understood agricultural trade was discussed.

This story appeared on the sputniknews.com website at 1:28 p.m. Moscow time on their Monday afternoon, which was 6:28 a.m. EDT in New York.  Once again I thank Roy Stephens for finding it for us.

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19 Reasons Why You Should Never Visit Iran

No doubt you’ve heard a lot about Iran in the media. And it’s true, Iran is a truly evil and terrifying place. Here we present 19 reasons you should never, ever, visit this godforsaken land.

To tell you the truth, dear reader, two countries I'd love to spend some serious time in are Iran and neighbouring Turkey.  There's just so much history---and so much culture.  And I'd bet serious money that they people that live there are wonderful as well.  The pictures I would take!!!  This must read photo essay appeared on the pulptastic.com Internet site.  I thank Nitin Agrawal for passing it around yesterday.

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Unprecedented development ahead for renminbi

The Bank of China's chief economist Cao Yuanzheng feels China's efforts to promote the renminbi (RMB) as an international currency is blazing a new trail in world history.

"I think this is an unprecedented process in economic history," Cao said in an exclusive interview with Xinhua on the sidelines of the "RMB: Going Global. The Bank of China Renminbi Internationalization Forum".

Renminbi development may be unprecedented but carefully mapped out nevertheless. In his remarks during the forum, Cao said the process has its roots back in the 1990s, and the veteran economist said he still believed it would take several more years for the level of international convertibility of the currency.

"I now think we can speak in terms of years and not decades," Cao said. "I cannot predict the time table, but I think we'll get there before 2020."

This news item, filed from Rome, appeared on the chinadaily.com.cn Internet site on Saturday---and I found embedded in an article posted on the tfmetalsreport.com Internet site via a GATA release yesterday.  It's worth reading.

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Japan Breaks 48-Month Deficit Streak, Manages Marginal Trade Surplus on Collapse in Imports

After 48 months of trade deficits, March saw a very modest ¥3.3bn surplus (vs. a ¥409bn deficit expectation), driven by a collapse in imports. Exports rose 8.5% (as expected) but against already dismal expectations of a 12.6% drop, March saw Japanese imports crash by 14.5% - the most since Nov 2009 (driven by the plunge in oil prices - alleviating some of the post-Fukashima fuel demands cost). Of course this is terrible news for stocks as it means less stimulus from the BoJ...and the yen is strengthening modestly.

This is another tiny Zero Hedge story with three embedded charts.  It appeared on their Internet site at 8:05 p.m. EDT yesterday evening---and it's courtesy of Dan Lazicki.

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Wall Street Has No Idea How Much Money Venezuela Has

Bond investors suspect the Venezuelan government is pretty low on cash. Just how low, though, is a tricky question.

After all, this is a country that has stopped releasing even the most basic economic data -- things like inflation and government spending -- on a timely basis.

Given how high the stakes are, with many investors bracing for an imminent default, Wall Street analysts are scrambling to fill the void. Firms including Bank of America Corp. and Barclays Plc have created their own statistical series to try to help investors understand how dire the country’s cash squeeze is. It’s a challenging exercise, they say.

This very interesting article showed up on the Bloomberg website at 7:56 p.m. MDT on Monday evening---and it's the second contribution of the day from Elliot Simon.  The original headline read "Wall Street is refusing to accept Venezuela's blackout of data".

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N.Y. apartments, art store wealth better than gold now, BlackRock chairman says

Gold’s traditional role as a store of wealth has been usurped by contemporary art and apartments in cities such as New York and London, according to Laurence D. Fink, head of the world’s biggest asset manager.

“Historically gold was a great instrument for storing of wealth,” the chairman of BlackRock Inc. said at a conference in Singapore on Tuesday. “Gold has lost its luster and there’s other mechanisms in which you can store wealth that are inflation-adjusted.”

Over the centuries, bullion traditionally lured demand as a protection of wealth during crises, including conflicts and periods of inflation. Prices posted the first back-to-back annual drop last year since 2000 as investor holdings in exchange-traded products contracted, global equities rallied and the dollar climbed on prospects for higher U.S. interest rates. Since peaking in 2011, it’s dropped about 38 percent.

“The two greatest stores of wealth internationally today is contemporary art….. and I don’t mean that as a joke, I mean that as a serious asset class,” said Fink. “And two, the other store of wealth today is apartments in Manhattan, apartments in Vancouver, in London.”

And as Chris Powell said in the preamble to this Bloomberg story in his GATA release---"If only someone had asked him why gold has lost its sheen. But that would have required actual journalism."  Amen to that bro!  This article showed up on their website at 11:48 Mountain Daylight Time on Monday evening.

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Book tells of Germany's foreign-vaulted gold and the campaign to bring it home

A book chronicling the German gold repatriation campaign, written by its leader, Peter Boehringer, has just been published. It's titled "Holt Unser Gold Heim: Der Kampf um das Deutsche Staatsgold," which is roughly "Bring Our Gold Home: The Struggle over the German State's Gold."

In addition to the history of the gold repatriation movement, the book reviews the history of postwar Germany's vaulting much of its gold abroad and explains gold's crucial and enduring if unappreciated place in the world financial system.

This short GATA release was posted on their website on Tuesday afternoon EDT.

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Currency Wars Back as Russia Buys One Million Ounces of Gold in March -- Mark O'Byrne

Russia increased its gold holdings by one million ounces in March, bringing its total reserves to nearly 40 million ounces or 1,238 metric tonnes. The Russian one million ounce gold purchase is a large one even by Russian standards as in recent years they have consistently been buying roughly 300,000 ounces per month.

It followed a two month break from the gold market which had led to erroneous speculation that Russia was not interested in increasing its gold reserves any further.

Since 2005, Russia’s gold reserves have increased three-fold. As a comparison, in the second quarter of 2009, Russia only had 550 tonnes of gold in its official reserves meaning that their reserves have doubled in recent years.

The 1 million ounce gold buy in March by The Central Bank of the Russian Federation was certainly in the news Monday and yesterday---and here's Mark's comments on it as posted on the goldcore.com Internet site yesterday.

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Russian central bank gold buying back with a vengeance -- Lawrence Williams

According to a Russian central bank announcement on its latest gold reserve position it appears that it added 1 million ounces of gold (31.1 tonnes) to its holdings in March after a two month hiatus, bringing its total reserves to 39.8 million ounces (1,237.9 tonnes). There had been speculation that the nation had been cutting back on its gold purchases due to the economic difficulties it had appeared to face due to the falling oil price and western sanctions.  However the lack of any increase in the early months of the year is a pattern we have seen before – but now the March rise is the highest seen since last September when the bank added 1.2 million ounces (37.3 tonnes) which itself was the largest monthly total in 16 years. The big March gold reserve rise could thus be a signal that the Russian central bank is strongly back on its gold buying spree.

The news of the latest Russian gold reserve addition confirms the World Gold Council prediction that overall central bank gold reserve rises will continue at a strong rate this year – and there is also speculation by Bloomberg that China may also confirm a big rise in its reserve by as much as 2,500 tonnes or more in the months ahead as it jockeys to try and have the yuan accepted by the IMF as a part of the make-up of a revised Special Drawing Rights basket – although as we have pointed out here before this is something which could be vetoed by the U.S. as not being in its interest given its 16.75% blocking voting interest in significant IMF decisions.

This commentary by Lawrie on Russia's gold purchase was posted on the mineweb.com Internet site late yesterday morning in London---and it's worth reading as well.

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Apr 21, 2015

The S(chizophrenic) & P(sychotic) 500

Does this behavior look like a market that is pricing-in a Fed rate hike?  Total Schizophrenia...

And if you're wondering what catalyzed this latest 350 point ramp in The Dow?  Perfect bounce on Friday off the Payrolls cliff edge... and machines then auctioned stocks up to Friday's cliff edge in search of sellers...

The above is all there is to this brief Zero Hedge article that appeared on their website at 12:16 p.m. EDT on Monday afternoon---but the three embedded charts are worth the trip.  Today's first story is courtesy of Dan Lazicki.

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Stan Druckenmiller Is Betting on Three Market Surprises in 2015

Stan Druckenmiller is betting on the unexpected.

The billionaire investor, who has one of the best long-term track records in money management, is anticipating three market surprises: an improving economy in China and rising oil prices. He also doesn’t expect the Federal Reserve to raise interest rates in 2015, a move most investors are forecasting will happen in September after six years of keeping them near zero.

“My fear is that we won’t see anything for a year and a half,” Druckenmiller, speaking of an interest rate increase, said in a Bloomberg Television interview. “I have no confidence whatsoever that we’ll see a rate hike in September or December.”

Druckenmiller, who now runs a family office after closing his Duquesne Capital Management hedge fund in 2010, has repeatedly criticized the Federal Reserve for keeping interest rates near zero for too long. He told an audience at the Lost Tree Club in North Palm Beach, Florida, on Jan. 18 that monetary policy has been reckless.

This story, along with an embedded 42:20 minute video interview, appeared on the Bloomberg website a week ago---and it's courtesy of reader Ken Hurt.  He says it's a "good one"---and I'll take his work for it, as I haven't watched it.

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Gundlach Says Market Hasn’t Seen Full Impact of Fed Moves

DoubleLine Capital’s Jeffrey Gundlach, the bond manager who has beaten 99 percent of his peers over the past five years, said the full impact of the Federal Reserve’s “extreme policies” have yet to be felt in the market.

The Fed has been “very well-intentioned,” Gundlach said, speaking in an interview on Sunday on Wall Street Week. “The ultimate consequences of all these extreme policies have yet to be felt and will be felt.”

The central bank has kept rates in the U.S. near zero and embarked on unprecedented monetary stimulus since the 2008 financial crisis. Known for his contrarian views and top returns, Gundlach said rating the Fed very highly at this point is “sort of like a man who jumps out of a 20-story building, and after falling 18 stories, says, ‘So far, so good.’”

Gundlach, who manages the $46.2 billion DoubleLine Total Return Bond Fund, has beaten 99 percent of peers over the past five years, according to data compiled by Bloomberg. He said last month that if the Fed increases interest rates by mid-year, they would have to reverse course. On Sunday, he said that the probability of a rate increase by the Fed in June is very low, because the economic data doesn’t support such a move.

This Bloomberg article showed up on their Internet site at 9:48 a.m. on Sunday morning EDT---and I thank West Virginia reader Elliot Simon for sending it.

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Oil prices source of imbalance, global banks say

Backers of the World Bank and International Monetary Fund are called on to remain vigilant against monetary shocks like the low price of oil, the banks said.

The IMF and World Bank issued a joint statement following their annual spring conference in Washington. The meeting came as global economic dynamics are shifting in an era of lower oil prices, a key barometer of economic health.

Both institutions said the global economy this year is growing faster than in 2014, though rates of growth are uneven.

Both banks issued a call on supporting countries to ensure they have effective policies in place to protect against "adverse shocks" like lower oil prices.

This UPI story, filed from Washington, was posted on their website at 8:17 a.m. EDT yesterday---and it's the first offering of the day from Roy Stephens.

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Caveat creditor as IMF chiefs mull unpayable debts

The International Monetary Fund has sounded the alarm on the exorbitant levels of debt across the world, this time literally.

The theme trailer to its fiscal forum on the 'political economy of high debt' plays on our fears with the haunting tension of a Hitchcock thriller. A quote from Thomas Jefferson flashes across the screen in blood-red colours: "We must not let our rulers load us with perpetual debt."

We learn that public debt in the rich economies fell from 124pc of GDP at the end of Second World War to 29pc in 1973, a dream era that we have left behind.

The debt burden has since climbed at a compound rate of 2pc a year, accelerating into an upward spiral to 105pc of GDP after the Lehman crash. It is as if we had fought another world war.

When the IMF starts to quote Thomas Jefferson, you just know that there's big trouble in River City.  This must read Ambrose Evans-Pritchard commentary appeared on The Telegraph's website at 3:30 p.m. BST on their Sunday afternoon---and it's courtesy of Roy Stephens.

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The Crowning Glory of Keynesianism

Readers of this publication will know that for some time, I’ve forecasted the creation of a new monetary system by which governments and banks gain total control over all monetary transactions.

On the surface of it, this may seem an impossible goal, as it would be so all-encompassing and would eliminate economic freedom entirely. Surely, it would not be tolerated. However, I believe that it’s not only relatively easy to create, but it will be sold in such a way that the public will see it as an absolute panacea to their economic woes. Only those who are far-sighted will understand its level of destruction in advance of its implementation.

It might transpire like this:

This commentary by Jeff Thomas appeared on the International Man website yesterday---and I thank their senior editor, Nick Giambruno, for sending it our way.

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It’s official: Metro Vancouver is swept up in a real estate frenzy -- Barbara Yaffe

It is no exaggeration to use an F-word to describe Vancouver’s current real estate scene. As in, the market is in a Frenzy.

Observers describe a perfect storm of forces coming together to create a tempestuous result: A 5.8-per-cent jobless rate in B.C., low interest rates, a devalued Canadian dollar attracting more foreign buyers, and panic over prices going even higher if buying is delayed. Even the particularly vicious winters of recent years in Eastern Canada may be having an impact.

Meanwhile, the Bank of Canada warned last Wednesday about the risk of correction in three Canadian property markets — Vancouver, Toronto and Calgary.

For the moment, few are heeding the caution. A press release sent out last week by WestStone Properties, regarding its Evolve condominium project in Surrey, reported sales in a single day (April 11) of 300 condo units, worth $70 million.

This article appeared on the Ottawa Citizen website on Sunday sometime---and my thanks go out to Roy Stephens.

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How sleepy Finland could tear apart the euro project

Finland is the unlikely stage for the latest turn in Greece’s interminable debt drama this weekend.

With events having decamped temporarily to Washington D.C., Athens will be keeping half an eye on developments in Helsinki, where the Nordic state of just 5.4m people heads for the polls on Sunday.

In the five years since Greece’s financial woes were revealed to the world, it has been sleepy Finland which has emerged as the most trenchant critic of EU largesse to the indebted Mediterranean.

The outcome of the country’s general election could now determine Greece’s future in the monetary union.

This news item showed up on the telegraph.co.uk Internet site at 1:30 p.m. on Saturday afternoon BST, which was 8:30 a.m. in New York.

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Thousands in Germany protest against Europe-U.S. trade deal

Thousands of people marched in Berlin, Munich and other German cities on Saturday in protest against a planned free trade deal between Europe and the United States that they fear will erode food, labor and environmental standards.

Opposition to the Transatlantic Trade and Investment Partnership (TTIP) is particularly high in Germany, in part due to rising anti-American sentiment linked to revelations of U.S. spying and fears of digital domination by firms like Google.

A recent YouGov poll showed that 43 percent of Germans believe TTIP would be bad for the country, compared to 26 percent who see it as positive.

The level of resistance has taken Chancellor Angela Merkel's government and German industry by surprise, and they are now scrambling to reverse the tide and save a deal which proponents say could add $100 billion in annual economic output on both sides of the Atlantic.

This Reuters article, filed from Berlin, put in an appearance on their website at 2:30 p.m. EDT on Saturday afternoon---and I thank Orlando, Florida reader Dennis Mong for finding it for us.

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Swiss Pension Schemes 'Bankrupt in 10 Years' -- It's Like They've Never Heard of Gold

Swiss pension schemes will be bankrupt within 10 years unless Switzerland's government wins public support for a radical overhaul of the retirement system, experts have warned.

The pressure on Switzerland's occupational pension system, which accounts for SFr800 billion ($840 billion) of assets, has intensified this year due to recently imposed charges on cash accounts and shrinking government bond yields.

Martin Eling, professor of economics at the University of St Gallen, estimated that occupational pension funds will face a SFr55 billion hole in their funding by 2030 if the government does not overhaul the system.

This Financial Times article was posted in the clear in a GATA release on Sunday.

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Russia denies striking gas deal to net Greece €5 billion

Russia has denied providing up to €5bn to Greece for a planned gas pipeline, in a move that would significantly ease Athens' cash crisis.

According to reports in Der Spiegel, Moscow was ready to provide advanced payment to Greece in assent for its "Turkish Stream" project.

The magazine quoted a senior Syriza minister saying the deal would "turn the tide" for the debt-stricken country, and could be signed as early as Tuesday.

However, the Kremlin later denied it had reached an agreement for any financial aid in advance of future profits from the pipe's transit fees.

This news story appeared on the telegraph.co.uk Internet site at 4:30 p.m. BST on Saturday afternoon in London---and I found it over at the gata.org website.

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Europe ready for Grexit contagion as Athens gets closer to Russian cash

The European Central Bank has warned that a rupture of monetary union and Greek exit from the euro could have dramatic consequences, but insisted that it has enough powerful weapons to avert contagion.

Mario Draghi, the ECB's president, said it would be far better for everybody if Greece recovers within EMU but made it clear that the currency bloc is no longer vulnerable to the immediate chain-reaction seen in earlier phases of the debt crisis.

Greek sources have told The Telegraph that Syriza may sign a deal with Russia for Gazprom's "Turkish Stream" pipeline project as soon as next week, unlocking as much as €3bn to €5bn in advance funding.

This confirms a report in Germany's Spiegel magazine, initially denied by both the Russian and Greek governments. It is understood that the deal is being managed by Panagiotis Lafazanis, Greece's energy minister and head of Syriza's militant Left Platform, a figure with long-standing ties to Moscow.

So, dear reader, which is it?  Will $5 billion be forthcoming from Russia or not?  Stay tuned to this ongoing soap opera/saga/farce---you pick.  This Ambrose Evans-Pritchard article was posted on The Telegraph's website at 10:00 p.m. BST on Sunday evening---and it's worth reading.  My thanks to Roy Stephens for sending it.

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Greece Flashes Warning Signals About Its Debt

By the standards of his frenzied schedule here last week, the meeting on Friday between Yanis Varoufakis, the Greek finance minister, and Lee C. Buchheit, the dean of international debt lawyers, was a quiet one.

There was none of the media scrum that had followed Mr. Varoufakis around town during the semiannual meetings of the International Monetary Fund and World Bank, as he paid calls on the I.M.F. chief, Christine Lagarde; the head of the European Central Bank, Mario Draghi; the United States Treasury secretary, Jacob J. Lew, and even President Obama.

But the get-together with Mr. Buchheit carried critical meaning, according to experts here. After all, it was Mr. Buchheit who helped broker Greece’s most recent debt refinancing, in 2012.

As Greece now gropes for a resolution to its current financial problems, the meeting suggests Athens might still be holding out hope for a restructuring of its debt burden of 303 billion euros, or $327 billion.

Not a word in this story about Russia, gas, or the $5 billion dollars.  That doesn't entirely surprise me as it was posted on The New York Times website---and it appeared there on Sunday sometime.  It's another offering from Roy Stephens.

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Stunned Greeks React to Initial Capital Controls and the "Decree to Confiscate Reserves"---and They Are Not Happy

Earlier today, following weeks of speculation, Greece finally launched the first shot across the bow of capital controls, when it decreed that due to an "extremely urgent and unforeseen need" (ironically the need was quite foreseen since about 2010, but that is a different story), it would be "obliged" to transfer - as in confiscate - "idle cash reserves" located across the country's local governments (i.e., various cities and municipalities) to the Greek central bank.

Several hours later the decree which was posted in the government gazette has finally percolated among the population, and the response to what even ordinary Greeks realize is now the endgame, is less than exuberant.

Bloomberg reports, that "as Greece struggles to find cash to stay afloat, local authorities say they oppose a government decision to use their reserves for short-term financing."

“The government’s decision to seize our reserves not only raises legal and constitutional issues, but also a moral one,” said George Papanikolaou, mayor of Glyfada, the third-largest municipality in the metropolitan region of Attica after Athens and Piraeus. “We have a responsibility to serve our citizens,” Papanikolaou said by phone on Monday.  Glyfada has about €16 million in cash reserves, he said.

This story appeared on the Zero Hedge website at 3:54 p.m. yesterday afternoon---and I thank Dan Lazicki for bringing it to our attention.

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U.S.-Ukraine Military Drills Risk Intensifying Civil War – Former U.S. Diplomat

Commenting on the arrival of 300 U.S. paratroopers in Lviv, western Ukraine, former U.S. diplomat and Senate staffer James Jatras told Radio Sputnik that the initiative risks undermining the fragile peace in eastern Ukraine, and does absolutely nothing for U.S. security interests.

Late last week, U.S. paratroopers from the 173rd Airborne Brigade began a six-month training rotation with Ukrainian National Guard forces. Commenting their arrival, Jatras explained that "it's quite clear that these [drills] are intended to increase the combat effectiveness of the Ukrainian forces."

This, according to the expert, "could be understood as something that is directly meant to undermine the Minsk II agreement, and to support those elements in Kiev who still believe there is a military solution to the political problem in eastern Ukraine."

This article put in an appearance on the sputniknews.com Internet site at 8:00 p.m. Moscow time on their Monday evening, which was 1:00 p.m. EDT in Washington.  I thank Jim Skinner for sending it our way.

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Turkey’s Long-Term Potential and Short-Term Problems -- Jim Rickards

I recently returned from Istanbul, Turkey. I had the opportunity to meet with a director of the central bank, along with stock exchange officials, regulators, major investors and one of Turkey’s wealthiest men, Ali Ağaoğlu, a flamboyant property developer known as “the Donald Trump of Turkey.”

I also spent time with everyday citizens from store owners to taxi drivers and more. Invariably, such a range of contacts produces information and insights beyond those available from conventional research channels and buy-side reports. It was a great chance to gather market intelligence on the world’s eighth-largest emerging market.

If you visit Istanbul, you cannot help but be impressed with the indelible beauty of the city. It’s easily on a par with Paris, Venice and other beautiful cities of the world. Istanbul also has more than its share of history, having witnessed the rise, fall and clash of empires from late-antiquity Romans, through Greek Byzantines, Ottoman conquerors and Persian rivals. The mix of East and West, Christian and Muslim and old and new is like no other city in the world.

Turkey is a test-tube study in how emerging market countries reach developed status. As such, it is subject to the interactions between developed and emerging markets, including hot money capital flows, currency wars and the struggles with interest rate policy and inflation.

This commentary by Jim appeared on the dailyreckoning.com Internet site yesterday sometime---and I thank Dan Lazicki for finding it for us.

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U.S. Navy warships deployed to Yemeni waters, could block Iranian weapons

A U.S. carrier battle group is repositioning to the Arabian sea in response to a deteriorating security situation in

Yemen, but Pentagon officials denied reports that the move is designed to intercept Iranian ships.

“Ships are repositioning to conduct maritime security operations, they are not going to intercept Iranian ships,” Col. Steve Warren, Pentagon spokesman, said.

The Associated Press sent a breaking news alert reporting the aircraft carrier USS Theodore Roosevelt is steaming toward the waters off Yemen to join other American ships prepared to intercept any Iranian vessels carrying weapons to the Houthi rebels fighting in Yemen.

The carrier, as well as the cruiser USS Normandy, transited the Strait of Hormuz on Sunday night and are now conducting operations in the Arabian Sea, Col. Warren said.

This news item appeared on The Washington Times website yesterday---and I thank International Man's senior editor Nick Giambruno for passing it around.

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Major Chinese Developer Says It Can’t Pay Dollar Debts

Kaisa Group Holdings Ltd. became China’s first real estate company to default on its U.S. currency debt, capping a month of distress in bond markets amid an anti-corruption probe and fueling concern that losses will spread.

The default coincides with the expiration of a 30-day grace period on $52 million of missed interest payments on two dollar-denominated bonds, according to a Hong Kong stock exchange statement Monday. Kaisa, based in the southern city of Shenzhen, is struggling to service 65 billion yuan ($10.5 billion) of debt owed to both onshore and offshore lenders while becoming embroiled in President Xi Jinping’s crackdown on graft.

The developer’s problems have rippled across the region’s debt market, where investors starved of yield elsewhere in the world have swooped in to boost returns. As the government’s anti-corruption probes widen, it’s raising concern that defaults will spread after overseas noteholders bought a record $21.3 billion of bonds issued by Chinese property companies.

“It’s been a canary that has been chirping for some time,” Gary Herbert, a money manager who helps oversee about $45 billion of fixed-income assets at Brandywine Global Investment Management LLC in Philadelphia, said in a telephone interview. “This is the beginning of an adjustment period in China that will see a lot of credit investors, who were chasing the promise of higher yields, ultimately disappointed.”

This Bloomberg story was posted on their Internet site at 6:19 a.m. EDT on Monday morning---and I thank Norman Willis for sharing it with us.

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China makes big cut in bank reserve requirement to fight slowdown

China's central bank on Sunday cut the amount of cash that banks must hold as reserves, the second industry-wide cut in two months, adding more liquidity to the world's second-biggest economy to help spur bank lending and combat slowing growth.

The People's Bank of China (PBOC) lowered the reserve requirement ratio (RRR) for all banks by 100 basis points to 18.5 percent, effective from April 20, the central bank said in a statement on its website www.pbc.gov.cn.

"Though the growth in the first quarter met the official target of around 7 percent for 2015, the slowdown in several areas, including industrial output and retail sales, has caused concern," said a report published by the official Xinhua news service covering the announcement.

The latest cut, the deepest single reduction since the depth of the global crisis in 2008, shows how the central bank is stepping up efforts to ward off a sharp slowdown in the economy.

This Reuters article, filed from Beijing, showed up on their Internet site at 12:15 p.m. EDT on Sunday afternoon---and my thanks go out to Harry Grant for bringing it to our attention.

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Japanese population falls to 15-year low

Japan’s population has shrunk for the fourth year running, falling back to a level it was last at in 2000, the government said. More than one in four people are now 65 or older.

The population dropped by 0.17%, or 215,000 people, to 127,083,000 as of 1 October last year, according to the data released on Friday. The figure includes long-staying foreigners.

The number of people aged 65 or over rose by 1.1 million to 33 million and now outnumber those aged 14 or younger by two to one.

Japan’s rapidly greying population poses a major headache for policymakers who are faced with trying to ensure an ever-dwindling pool of workers can pay for the growing number of pensioners.

If you take a cursory glance at any chart regarding the demographics of Japan, you'll see that Japan's population is now in permanent  decline.  This article appeared on theguardian.com Internet site at 6:02 a.m. BST on Saturday morning---and it's worth reading.  I thank reader "F.P." for sending it our way.

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Russia Returns to Gold With Biggest Purchases in Six Months

After a two-month hiatus, Russia’s appetite for buying gold is back.

The nation increased foreign reserves of bullion to 39.8 million ounces, or about 1,238 metric tons, as of April 1, compared with 38.8 million ounces a month earlier, the central bank said on its website Monday. The 30-ton purchase was the most since September.

Russia, the fifth-biggest holder of the metal, returned to buying gold after taking a break in January and February. The country, which bought gold through the last nine months of 2014, made the purchases to diversify foreign reserves and solve issues related to ruble liquidity, central bank Governor Elvira Nabiullina said in February.

“It’s interesting that Russia is still buying because it’s economy has taken a knock from Western sanctions and from lower oil prices,” David Jollie, an analyst at Mitsui & Co. Precious Metals Inc., said by phone from London. “This sends a very bullish signal to the gold market.”

It's only bullish if JPMorgan et al want it to appear that way---and yesterday wasn't that day, either.  This Bloomberg article put in an appearance on their Internet site at 7:59 a.m. Monday morning EDT---and I found it embedded in a GATA release.  It's worth reading.

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Indian gold imports may rise 89 percent in April, jewellers group says

India's gold imports are likely to rise more than 89 percent at 100 tonnes this month compared with last year, mainly due to weakness in international prices and easing of restrictions by the Reserve Bank of India, an industry body said.

Gold imports stood at 53 tonnes during April last year, according to data given by The All-India Gems and Jewellery Trade Federation.

"Until now we have imported nearly 100 tonnes of gold. So we are expecting the total imports to be a little over 100 tonnes," GJF's new Chairman Manish Jain told PTI here. 

However, imports will be lower than March, when India had shipped in 159.5 tonnes of gold as jewellers were stocking up in preparation for Akshaya Tritiya and the marriage season, Jain said.

This short gold-related news item showed up on The Economic Times of India at 8:14 p.m. IST on their Monday evening---and it's another article I found on the gata.org Internet site yesterday.  It's worth your time as well.

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Gold jewelers count on Indian festival fortunes to rouse deman

Indian jewelers are banking on what’s considered one of the most auspicious days for gold buying to spur demand in the world’s biggest bullion consumer.

Sales on Tuesday’s Akshaya Tritiya, viewed by the country’s more than 900 million Hindus as a traditional day to buy precious metals, may increase as much as 20 percent from 2014, Manish Jain, chairman of the All India Gems & Jewellery Trade Federation, said by phone from Mumbai on Monday. The nation’s gold consumption slid 14 percent last year.

A resurgence in India’s appetite for bullion may help halt a decline in gold prices for a third straight quarter that was prompted by a withdrawal of investors from gold-backed exchange- traded funds. Demand is getting a further boost after the government ended most controls on imports that helped contain a record current-account deficit and decline in the currency.

“A positive mood exists among the retail sector as Akshaya Tritiya is considered the most auspicious time of the year for purchase of gold,” Jain said. “Gold continues to be a dependable hedge against inflation and is still a valuable purchase” for Indians, he said.

This Bloomberg story from early this morning London time was posted on the mineweb.com Internet site.

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Mystery of China's gold stash may soon be solved at IMF

China's push to challenge U.S. dominance in global trade and finance may involve gold -- a lot of gold.

While the metal is no longer used to back paper money, it remains a big chunk of central bank reserves in the U.S. and Europe. China became the world's second-largest economy in 2010 and has stepped up efforts to make the yuan a viable competitor to the dollar. That's led to speculation the government has stockpiled gold as part of a plan to diversify $3.7 trillion in foreign-exchange reserves.

The People's Bank of China may have tripled holdings of bullion since it last updated them in April 2009, to 3,510 metric tons, says Bloomberg Intelligence, based on trade data, domestic output and China Gold Association figures. A stockpile that big would be second only to the 8,133.5 tons in the U.S.

"If you want to set yourself up as a reserve currency, you may want to have assets on your balance sheet other than other fiat currencies," Bart Melek, head of commodity strategy at TD Securities, said by phone from Toronto. Gold is "certainly viewed as a viable store of value for an up-and-coming global power," he said.

This very worthwhile story was posted on the Bloomberg website at 10:01 a.m. on Monday morning EDT---and it's another story that was embedded in a GATA release.

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China silver stockpiles surge

Silver stockpiles in China surged this year as the country’s slowing economic growth weakened demand for the precious metal, according to a state researcher.

Inventory monitored by the Shanghai Futures Exchange almost tripled to 341.5 metric tons April 9, the highest in a year, from 122.8 tons in the final week of 2014, according to weekly bourse data compiled by Bloomberg. Stockpiles on the Shanghai Gold Exchange also more than doubled this year to 263.97 tons on April 3, exchange data show.

Chinese silver producers delivered the metal to exchange warehouses amid falling physical demand, said Jin Xiangyun, a senior precious metals analyst at Beijing Antaike Information Development Co. China’s economy expanded at the weakest pace since 2009 last quarter, indicating a deepening slowdown. The global benchmark price has fallen 17 percent in the past year.

“Silverware and jewelry makers said they wouldn’t produce much because of weak demand,” Jin said in a telephone interview April 22, citing their recent survey of producers. “Fabricators usually purchase large amounts of refined silver after Chinese New Year holidays. That didn’t happen for this year.” The break was from April 18-24 this year.

This Bloomberg article from last Friday showed up on the mineweb.com Internet site.

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Here's the real, forgotten meaning of 'The Wizard Of Oz'

Turns out the book and movie may be an economic fairy tale about America in the late 1800s — and gold.

Well, dear reader, if you are one of the few that doesn't know the real story behind L. Frank Balm's book "The Wonderful Wizard of Oz"---and the subsequent 1939 movie---please take 2:06 minutes out of your busy life---and watch this video that was posted on the businessinsider.com Internet site at 11:49 a.m. EDT on Sunday morning.  I thank Roy Stephens for today's last story.

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